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Oil prices were stable on Friday, as investors weighed a weaker market outlook for this year by the International Energy Agency (IEA) despite tightness in the prompt market, in addition to tariff concerns and possible further sanctions on Russia.
Brent crude futures were up 19 cents, or 0.28 per cent, at $68.83 a barrel as of 0807 GMT US West Texas Intermediate crude ticked up 25 cents, or 0.38 per cent, to $66.82 a barrel.
Both contracts were little changed on the week, with Brent headed for a 0.8 per cent gain against last Friday’s close, and WTI for a 0.3 per cent loss against last Thursday’s close as markets were closed on July 4.
The IEA on Friday boosted its forecast for supply growth this year, while also trimming its outlook for growth in demand.
That notwithstanding, the IEA said peak summer refinery runs to meet travel and power-generation demand were keeping the market tight for now.
Front-month September Brent contracts were trading at a $1.11 premium to October futures at 0807 GMT.
“Despite a market-wide expectation of an oil glut at the back end of this year, the current spate of drivers is lacking anything that might send prices back to the lows seen in April and May. Civilians, be they in the air on the road, are showing a healthy willingness to travel,” PVM analyst John Evans said.
One other sign of robust prompt oil demand was the prospect of Saudi Arabia shipping about 51 million barrels of crude oil in August to China, the biggest such shipment in over two years.
Longer term, however, rival forecasting agency OPEC cut its forecasts for global oil demand in 2026 to 2029 because of slowing Chinese demand, the group said in its 2025 World Oil Outlook published on Thursday.
Both benchmark futures contracts lost more than 2 per cent on Thursday as investors worried about the impact of Trump’s evolving tariff policy on global economic growth and oil demand.
“Prices have recouped some of this decline after President Trump said he plans to make a ‘major’ statement on Russia on Monday. This could leave the market nervous over the potential for further sanctions on Russia,” ING analysts wrote in a client note.
Trump has expressed frustration with Russian President Vladimir Putin due to the lack of progress on peace with Ukraine and Russia’s intensifying bombardment of Ukrainian cities.
The European Commission is set to propose a floating Russian oil price cap this week as part of a new draft sanctions package.
